Preparing your practice for profitable growth
The economy has been difficult for some time, and I would like to share the suggestion that I have been giving audiences for the last 12 months.
by Roger P. Levin, DDS
For more on this topic, go to www.dentaleconomics.com and search using the following key words: economy, practice basics, scheduling, productivity, production, case presentation, financial options, investment, profitability, Dr. Roger Levin.
The economy has been difficult for some time, and I would like to share the suggestion that I have been giving audiences for the last 12 months. The suggestion is very simple — ignore the economy! By that, I mean focus on the things you can actually control. The stock market will continue to fluctuate whether you watch it or not. But your practice is another story. After all, it's the best investment you ever made, and you can maximize that investment with the right management strategies, even during the current downturn.
The fact is that dental practices can often avoid the negative effects of the economy. Sure, there will be patients who delay treatment, leave a practice to go where their insurance is accepted, and stop going to the dentist altogether, but these things happen in any economy. What most practices fail to realize is they still have a high potential for growth.You can't let the loss of a small number of patients derail your quest for total practice success. Even in a tough economy, there are opportunities for practice growth. Now is the time to seize those opportunities!
Back to basics
When times get tough, all sports teams go back to basics. So do big businesses ... and so should dental practices. Where a big business might sell off one or two divisions, lay off 10,000 people, or borrow large amounts of money, dental practices have to do it differently. However, it is still about going back to basics.
Back to basics in a dental practice means putting all of the requisite systems in place, including:
- Case presentation
- Financial options
- Patient financial management
- Customer service
- Overhead control
Setting the proper foundation with strong systems will help you reach your potential. In a tight economy, you need to operate as efficiently as possible. Updated systems will increase productivity, reduce stress, and lead to greater profitability.
The scheduling system
Start with scheduling. It is the system that ultimately controls all other systems. If you start simply by improving financial options or case acceptance, you will probably not reach your potential. The schedule is the single system that has the greatest impact on practice production and profit. Levin Group teaches a concept called Power Cell Scheduling™ that focuses on the following principles:
- The schedule is designed to achieve the daily and annual goal.
- The schedule is designed for the most productive appointments to be performed in the morning, with minor procedures done in the afternoon.
- The schedule is designed so that every 10-minute Power Cell is pre-allocated prior to the beginning of the year. For example, if you see 30 new patients a month, then there will be 30 new patient Power Cell appointments available per month.
- The schedule should be broken up on a production-per-chair basis.
- Doctors should spend 95% of their time in direct patient care.
- 98% of active patients (or higher) should be scheduled.
- 99% of all patients who call the practice should schedule for appointments and 96% should present to the practice on an annual basis.
While an entire textbook could be written on the subject of scheduling, it is imperative that this be the first system addressed.
Reaching your production potential
To boost hygiene productivity and production, Levin Group designed a system called the Hygiene Maximizer™ that focuses on boosting production generated from the dental hygiene area. Hygienists spend far too much time simply doing basic prophylaxis, and miss the boat in a number of other areas, including promoting cosmetic and elective services, recommending ancillary services, performing cancer examinations, educating patients about home-care products, and creating a sense of value for hygiene. The hygiene department is the second largest producer in the practice, and all of the hygiene subsystems should be geared toward maximum production. Keep in mind that the doctor and the hygienist are typically the only two significant production centers in a dental practice.
The third key system to address is case presentation. This is an area that needs to be significantly overhauled in most practices. Simply sitting down with patients and telling them what they need is not a case presentation system. In today's tight economy, patients will have less discretionary income.
This means practices will have to do a much more effective case presentation than in years past to persuade patients to move forward with treatment. We often forget that patients are constantly facing difficult spending choices, and even more so in an economic downturn. Believe me when I tell you that patients will always choose their mortgage over dental treatment.
Case presentation has numerous steps and scripts to follow. Using a concept called Greenlight Case Acceptance™, Levin Group recommends the following principles:
Every practice should have a minimum of four financial options:
- 5% courtesy for cash up front
- Credit cards
- Paying half at the beginning and the balance before completion of treatment
- Patient financing
In today's economy, we believe patient financing takes on an even more critical role than in years past. If we look at the field of orthodontics, which was hit earlier by the down economy, we find that many patients could not afford the monthly orthodontic payment and decided to delay treatment. If this is true in orthodontics, then it is also true for every other area of dentistry. This situation means that another funding source is necessary for patients to go forward with treatment, and that source is patient financing.
In a world where patient financing can be accessed in three minutes with three pieces of information, it is essential that dental practices allow every patient to know that financing is available. Levin Group recommends that you offer a script such as this:
“Mrs. Jones, let me review the four wonderful financial options we offer, and then we can select the one that is best for you.”
Note that this script contains energizing words such as “wonderful” and a benefit statement such as “the one that is most convenient for you.” For more on scripting, see my recent blog entry at www.levingroupgp.com.
Following this introduction to the script, each financial option should be discussed in detail. You will be amazed at how many patients are relieved to know that financing is available. Your office and the patient are in control of the credit amount requested on each patient's application. Tips for case presentation include:
- Many more patients will say “yes” to treatment if they have two consults to give them time to prepare, analyze the offer, and look into their financial situation between appointments.
- Be certain that the financial presentation is well-scripted with before-and-after visuals to help patients imagine where they could be compared to where they are today.
- Be willing to offer phased treatment. We are finding tremendous benefit in case acceptance by phasing in several levels of treatment during a six-, 12- or 18-month period. For some reason, six-month segments seem to work very well.
- Finally, it always comes down to money, so be prepared to discuss financial options and have an extremely well-trained financial coordinator.
The best investment
While many dentists are anxiously following the ups and downs in the stock market, they need to remember their practice is still their best investment. The practice is the one area where doctors can make up in income whatever amount of investments they have lost in the economic downturn.
Unfortunately, many dentists do not maximize their practice opportunities. Instead of pursuing continual growth, systems improvement, team building, and strategic planning, they focus on the day-to-day and look for outside opportunities to improve their financial situation. An internal study at Levin Group indicated that a practice adding consulting services along with financial planning may more than double the net worth of a doctor at the time of retirement.
Get back to the basics. Put all of your systems in place and become committed to continual improvement in your practice. Finally, once the practice has been put in order, financial planning is a must. In today's complex economic world, the right financial experts will not only help you grow, but they will help you maximize the best investment you ever made.
Dental Economics® readers are entitled to a 20% courtesy on the Levin Group's Total Practice Success™ Seminar for all general dentists to be held July 24-25 in Las Vegas. To register and receive your discount, call (888) 973-0000 and mention Dental Economics® or e-mail email@example.com with “Dental Economics® TPS” in the subject line.
Roger P. Levin, DDS, is founder and CEO of Levin Group, a leading dental management consulting firm that is dedicated to improving the lives of dentists through a diverse portfolio of lifetime services and solutions. Since the company's inception in 1985, Dr. Levin has worked to bring the business world to dentistry. Levin Group may be reached at (888) 973-0000, or at www.levingroupbp.com.